Poseidon creditor shuts down Taber trucking firm

CALGARY — The financial woes of Calgary-based Poseidon Concepts Corp. spilled over to a small trucking company in Taber on Thursday, leading to a painful decision to close it down.

Jolene Trucking, which grew from four to six trucks to transport Poseidon’s iconic liquid storage tank systems to oil and gas leases around southern Alberta, is one of 115 creditors claiming a total of $94.4 million from the insolvent company.

Jolene’s claim on the list compiled by court-appointed monitor PwC (PricewaterhouseCoopers) is a little over $270,000, small compared to some of the others, but big enough to spell the difference between thriving and closing, said owner Josh Wurz.

In an emotion-choked voice, he said in a phone interview Thursday he had laid off three of his six drivers earlier in the day and would have to wind down his seven-year-old oilfield transport business.

“They were keeping us busy for two years, everything was good, until things crashed, went downhill,” Wurz said.

“It’s pretty well left us with a bad choice in life and that’s pulling the plug on the trucking company.

“I have to. I’ve got almost $300,000 owing and I’ve paid out all my vendors and my expenses and I’m not getting my revenue for the whole period of time. We’ve got no operating income.”

He said he has been told that because he is an unsecured creditor he would likely not recover any money from a liquidation of the company.

On Wednesday, the operator of the Toronto Stock Exchange announced Poseidon will be delisted as of May 19 “for failure to meet continued listing requirements.”

The stock had been suspended from trading since early February when the Alberta Securities Commission issued a cease trade order, reacting after Poseidon said it would have to restate its financial reports for the first nine months of 2012.

The company admitted that two-thirds of its $148 million in revenue for the three quarters ended Sept. 30 should not have been recorded as such and that about $100 million of its $126-million accounts receivable was also improperly recorded.

On April 10, the company that once had a market value of $1.3 billion announced it had been granted protection from creditors under the Companies’ Creditors Arrangement Act.

Its largest creditor, according to the PwC list, is a banking syndicate led by TD Bank, owed $79.5 million.

Poseidon is to continue operating under its court-appointed monitor using interim financing but former contractors said they aren’t seeing much activity in the field.

Brad King, operations manager for King Oil Field Services LLP of Parshall, N.D., said Thursday his family-owned company stopped working for Poseidon in October.

King Oil Field had been contracted to set up and disassemble Poseidon’s oilfield storage systems that resemble giant above-ground swimming pools, and also provided yard space, King said.

Business was booming initially, he said, because of the enormous quantities of water needed for hydraulic fracturing to produce oil from tight Bakken shale formations in North Dakota.

“We quit working for them last year because of lack of payment,” King said. “We were generating about $3 million a year with them.”

Since then, it has reduced its workforce to a dozen men from about 20. The creditors list shows King’s company claims about $475,000.

Another contractor, Drift Production Services of Gibbons, Alta., a small town just north of Edmonton, is owed $141,000, according to the PwC list.

“We just supplied manpower to set up and tear down the tanks plus we contacted the trucking companies to haul in and haul out their stuff,” said owner Shelby Karpenchuk.

The contract was a small part of her company’s oilfield services portfolio and the loss of work hasn’t resulted in any reduction to its staff of about 80, said Karpenchuk.

“It’s put a bit of a toll on me because (subcontractors) billed me directly so unless I get paid from Poseidon for the last bit here it could take a toll on the company,” she said.

Poseidon began trading in November 2011 after being spun off by junior explorer Open Range Energy Corp.

The tanks caught on quickly but competitors rushed similar products to market.

Before being cease-traded, Poseidon shares were fetching 27 cents each, less than two per cent of their peak level of $16.88 last February.

dhealing@calgaryherald.com

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